Billionaire Richard Branson is going to join the line of investors who have raised millions for blank check companies.
Billionaire and investor Richard Branson is planning to raise $460 million for a new blank check company. The English billionaire hopes to use the raised funds to create a new special purpose acquisition company (SPAC). Called VG Acquisition, the company will sell 46 million units of shares and warrants on the New York Stock Exchange (NYSE).
Richard Branson and New Blank Check Company
Over the past few years, individuals and entities have been raising capital through SPACs to pursue merger opportunities. In July, billionaire Bill Ackman raised $4 billion for his SPAC in an IPO offering. Also, another blank company backed by Paul Ryan, a former speaker of the US House of Representatives, raised $300 million at its offering.
As of the 22nd of July, nearly $18 billion has been raised in SPAC IPOs in 2020. According to Goldman Sachs, SPAC offerings are up 145% year-over-year.
More entities have also filed with the SEC to raise millions through blank check companies. An example is the acquisition firm Apollo Global Management. On Wednesday, the firm filed to raise $750 million for its blank check company called Apollo Strategic.
Now, billionaire Richard Branson is planning to join the line of investors who have raised millions for blank check companies. This was revealed in the 16th of September filing with the U.S. Securities and Exchange Commission (SEC).
As stated in the filing, the company’s incorporation will effect a merger, asset acquisition, share exchange, reorganization, or integration with one or more similar businesses. Furthermore, the filing also revealed that VG Acquisition has not decided on the kind of business to buy.
Nevertheless, over the next two years, the company will merge with a company that operates under the Virgin Group’s core sectors. These sectors include financial services, health, technology, mobile, music, media, travel, and renewables. Also, the company noted:
“We believe that the COVID-19 crisis has caused temporary dislocations in several of our focus sectors, creating a rare opportunity to invest in fundamentally strong target businesses at attractive valuations while providing needed financial and operational resources and access to the public markets.”
Effect of COVID-19 on Richard Branson
As a result of the persisting coronavirus pandemic, many individuals, including billionaire Richard Branson, are recording losses.
According to an April report by The Guardian, Branson said he might need to mortgage his private Caribbean island. The billionaire planned to raise money through the mortgage to save his Virgin Atlantic airline from collapsing. At the time, Branson also pleaded with the UK government for assistance through the period planes wouldn’t fly.
Shortly after, the billionaire also revealed plans to sell up to $504.5 million of his Virgin Galactic stake. This equals less than 22% of his total stake in the British spaceflight company. According to a press release addressing the development, the plan was to support the travel and holiday businesses affected by the pandemic.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
